It is important that entrepreneurs understand all of the various tasks that there Edmonton bookkeeping company will be doing for them so that they can ensure that there hiring the right bookkeeper for their business. 50% of all entrepreneurs end up failing in business before their fifth year, and only 11% of entrepreneurs ever seek help when they truly need it. The hiring of the right bookkeeper can have the information that they need to make great financial decisions, and those great financial decisions can help them avoid making poor financial decisions and help them be proactive in their business to avoid decisions that can cause their business to fail.
One of the most important things that a business owner needs to understand when hiring an Edmonton bookkeeping company, is that anyone can call themselves a bookkeeper. They do not need to have a certain amount of experience or go to school to get a degree, and anyone that has some basic knowledge, your knows how to run some accounting software can call themselves a bookkeeper whether they should or not. Therefore, entrepreneurs need to ensure that they are asking some very pointed questions when looking for the right bookkeeper for their business. They should look for bookkeepers that have experience in and accounting firm so that their familiar with what information an accountant needs from them, and how to organize their finances. Another great question that entrepreneurs can ask potential bookkeepers, is if they have gone through the accounting program. Many accountants need to have experience in the field before they can achieve their designation and hiring someone who has graduated from the program but has not to finish their designation yet can make an extremely good bookkeeper for their business.
One of the most important things that an Edmonton bookkeeping company is going to provide their business owner is interim financial statements and bank reconciliations. A business owner needs to understand what those are in order to ensure that their bookkeeper is providing the best one for them. Basically, bank reconciliation is a report that shows all of the transactions that have been made in the business, against all of the transactions that the bank has recognized. The reason why this is important to have before making financial decisions is that if a business owner is only looking at the bank balance to know how much money they have in their business, they could end up spending money that they do not have. For example, if the business owner has processed payroll, but the payments have not been disbursed yet, and they have written several large checks, some of which have not been cleared yet, a business owner may look at their bank statement and think that they have a lot more money than they actually do. The looking at the bank reconciliation, they can see how much money they have their bank after those payments have been taken into consideration. It is important that before a business owner makes any financial decisions in their business, they look at their bank reconciliation to know exactly how much money they have to spend.
If business owners are not taking enough due diligence and hiring their Edmonton bookkeeping company, they may end up in the wrong decision. Many entrepreneurs believe that because they have already hired a great accountant in their business, that they do not need to hire a knowledgeable bookkeeper. However this is a poor decision, because well both professions deal with the finances of the business, they do not do the same job. Accountants look after the year-end finances of the business and file their corporate taxes, deal with their business planning as well as their tax planning to ensure that they’re not paying more taxes than they need. On the other hand, but a bookkeeper does is organizes businesses day-to-day finances, and ensure that it is organized and that a business owner knows how much money they have in their business on a day-to-day basis. They allow business owners to make purchases, disburse payments and run payroll. If an entrepreneur hires a bookkeeper that does not do their job well enough, they can end up with incorrect financial statements, which will cause them to make poor financial decisions, and end up with financial statements that their accountant is going to have to fix. That can cause a business owner to pay even more money for their accounting services and potentially file their corporate year-end late which could trigger penalties.
They should ensure that there Edmonton bookkeeping company has knowledge of business taxes. In addition to ensuring that they have the finances in order, business owners need to ensure that their bookkeeper is knowledgeable in business taxes so that they can take the right taxes and pay them on time. For example, payroll taxes need to be paid by a certain time every month, and the bookkeeper needs to know not only what payroll taxes to withhold from each employee, but how much. If there submitting the wrong amount or submitting it late, business owners can end up with steep fines, penalties, and interest charges. The same thing with GST, Bill needs to know how to calculate but GST to send to the government and by when. The hiring of an Edmonton bookkeeping company that does not have enough experience or tax knowledge, can be disastrous and very expensive for business owners.
By doing their due diligence when hiring an Edmonton bookkeeping company, can ensure that a business owner ends up with the right business professional to help them stay financially organized, know how much money they have in their business, and can help them make the best financial decisions they can for their business. A great bookkeeper can help entrepreneurs avoid spending money that they do not have, and also be proactive in making decisions in their business so that they can generate more revenue when needed so that they can proactively grow their business.